2013 dairy exports expected to break record

USDEC projects another record-breaking year for dairy exports in 2013 and credits manufactuerers' commitment to make the U.S. a reliable global supplier and efforts by industry organizations to expand trade.

Cows enjoy fresh straw in a corral at Bokma dairy in Twin Falls. U.S. Dairy Export Council reported Jan. 8 that exports in the first 11 months of 2013 were valued at $6.1 billion and were on pace to approach $6.7 billion for all of 2013.

The 2013 year-end tally on U.S. dairy exports won’t be known until next month, but given the fact that exports through November were 17 percent higher than all of 2012, it’s destined to be another record-breaking year.

U.S. Dairy Export Council reported Jan. 8 that exports in the first 11 months of 2013 were valued at $6.1 billion and were on pace to approach $6.7 billion for all of 2013. That compares with exports worth $5.2 billion in 2012.

Exports of nonfat dry milk/skim milk powder, cheese, high-value whey protein concentrates and isolate, lactose, and fluid milk were all on pace for record highs in 2013. On a volume, 2013 is on track to be the fourth-consecutive record year and the ninth record year in the last 10 years, USDEC reported.

Strong global demand, domestic supply shortages in China and Russia and milk production shortages for major exporter New Zealand resulted in tight global dairy supplies in 2013, and U.S. prices were competitive with those of other exporting countries.

That helped boost exports in 2013 by a projected 30.4 percent in value and 17.5 percent in volume over 2012, representing 15.5 percent of U.S. milk production.

But the real highlights of the year lie behind the numbers, USDEC President Tom Suber said in a press release.

“The past year marked a major step in U.S. Dairy export expansion, not only because of the value and volume gains but because of the activities of U.S. suppliers and industry organizations to lay the groundwork for future growth,” he stated.

Last year’s success is the result of long-term investment by U.S. suppliers as they demonstrated greater commitment to meeting the needs of global buyers. Those efforts were bolstered by years of USDEC programs designed to reduce exporters’ risk in entering and remaining in overseas markets, USDEC reports.

U.S. manufacturers ramped up production of skim milk powder, leading to record exports of milk powder. Multiple U.S. manufacturers also began producing whole milk powder for export, and new shipments of ultra-high temperature shelf-stable milk to China tapped some of that country’s growing demand for the product.

The outstanding performance of dairy exports in 2013 was the result of manufacturers’ commitment to global markets by making the right products with the right specifications and expanding their product portfolio, USDEC reports.

“More than in previous years, we are seeing a broad acknowledgment of the critical role exports play in the health and growth of the U.S. dairy industry,” Suber stated.

It took a while, but products are being made to higher international and ingredient specifications and new products are being produced, said Jerry Dryer, chief market analyst for Rice Dairy brokerage firm, in his Dairy and Food Market Analyst newsletter on Friday.

“Kudos to USA dairy manufacturers,” he said, adding that Suber and his team at USDEC have “moved mountains” over the years

“The U.S. Dairy Export Council and yours truly have been talking about this happening for almost 20 years. Watching it unfold has been a delight and there is a lot more on the horizon,” he said.

Additional highlights of industry efforts in 2013 included:

• USDEC marketing activities to drive demand and preference for U.S. dairy product through programs to bring buyers and sellers together, which helped increase sales and U.S. market presence.

• USDEC assisting U.S. suppliers with compliance to new Chinese regulatory procedures as well as broader global efforts to clarify certification and inspection standards and labeling and product standards.

• USDEC working with U.S. trade negotiators, who made substantial progress toward completing the Trans-Pacific Partnership to open major new markets to U.S. exports and reduce non-tariff trade barriers.

• A checkoff-funded initiative for a voluntary, enhanced product traceability program to boost competitiveness in meeting the needs of global buyers and address ever-stricter U.S. food safety regulations.